U.S. electricity consumption is expected to rise by 2.4% this year, from 2021, because of rising economic activity and hot summer weather, according to the U.S. Energy Information Administration (EIA). Residential electric prices are estimated to be more than 6% higher.
On Tuesday (Aug. 9), the EIA released the August Short-Term Energy Outlook that shows growth in renewable energy will meet most of the increased electricity demand this year. Also helping to meet the demand, U.S. natural gas consumption has been higher than the previous five-year average so far this summer.
“This summer has been hotter in the United States than normal, even in the context of the pretty hot summers of the last few years,” said EIA Administrator Joe DeCarolis. “High temperatures have contributed to more air conditioning load, which is a significant driver in our forecast for more electricity consumption this year compared to last year.”
Continued demand for natural gas to generate electricity has led to high prices for natural gas even as more natural gas enters the domestic market amid the June shutdown of the Freeport liquefied natural gas terminal.
U.S. residential electricity prices are expected to be 6.1% higher in 2022, from 2021, primarily because of high natural gas prices. From July 1 to July 29, the Henry Hub spot price rose by almost 50%, from $5.73 to $8.37 per million British thermal units, because of the continued high demand for natural gas from the electric power sector. The average price is expected to fall from $7.54 per million British thermal units in the second half of the year to $5.10 in 2023 as natural gas production rises.
Following are other highlights in the Short-Term Energy Outlook:
• U.S. crude oil production is expected to rise from an average of 11.9 million barrels per day in 2022 to 12.7 million barrels per day in 2023, which would set a record for the most U.S. crude oil produced in a year.
• U.S. gasoline prices are projected to fall from an average of $4.29 per gallon in the third quarter to an average of $3.78 per gallon in the fourth quarter. Over the same period, average diesel prices are projected to fall from $5.02 to $4.39 per gallon.
• U.S. utility-scale capacity to generate electricity from solar power is expected to rise by 20 gigawatts in 2022 and 24 gigawatts in 2023, representing an addition of 31 billion kilowatt-hours of electric power generation in 2022 and 41 billion kilowatt-hours in 2023.
In late July, North Little Rock-based Seal Solar announced it’s installing a 2-megawatt array at Bearskin Farm Partnership, a family-owned farm in the community of Scott, east of Little Rock.
According to a news release, the 4,500-panel array is one of the largest installed on a farm in Arkansas. It will produce 3.57 million kilowatt-hours annually.
“Bearskin Farm Partnership looks forward to using solar to produce the electricity needed to grow and store crops while contributing to a cleaner Arkansas,” said Lambert Marshall of Bearskin Farm Partnership.
The array is expected to be completed in December.
“Solar is a natural fit for farms,” said Cody Wilson, vice president of design and engineering at Seal Solar. “We are giving farmers the ability to control their electricity costs like never before while utilizing an abundant natural resource – the power of the sun.”